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Stocks took a breather over the past week, but that doesn’t mean it’s quiet out there. The Morningstar US Market Index lost a little bit of ground after the previous week’s election-fueled rally. However, the market is up a solid 24% in 2024.
One notable change in the stock market since election day has been seen in the rally’s leadership. Over the past week and a half, small-company stocks have been the biggest winners, eclipsing the gains on the kinds of large-company names that have paced the bull market. What’s behind this rally, and will it continue? Sarah Hansen checked in with money managers about what they see in store for small caps.
While the stock market’s latest leg higher is of course good news for investors, it does make it more difficult to find attractive new opportunities to put money to work. Our weekly valuation screen for stocks under Morningstar’s coverage found dozens of newly expensive names, including Tesla, Visa, and UnitedHealth. Check out our list of stocks you might want to add to your “sell” list. The good news: There are also stocks for your “buy” list. We’ve got 11 new 4-star stocks, including AstraZeneca and TotalEnergies.
One of the key drivers of the rally has been continued decent profit growth. While third-quarter earnings growth was down from the second, the continued rally suggests investors are generally satisfied with what they’ve seen. Of course, some companies crushed it, and as we do every quarter, we combed through Morningstar’s coverage to find the stocks that posted stronger-than-expected earnings but are still cheap. We came up with five undervalued names.
Although many companies have reported their third-quarter results, the market’s biggest name is due this coming Wednesday after the bell. Morningstar strategist Brian Colello offers up his take on what to watch for in Nvidia’s results.
Speaking of big names, Berkshire Hathaway is out with its latest portfolio holding info. Susan Dziubinski highlights the stocks that Warren Buffett’s company has been buying and selling, along with what Morningstar analysts think of them.
To close things out, one of my financial columnist heroes is heading off into the sunset. John Rekenthaler (who was one of Morningstar’s first employees, hired in 1988) is stepping away from the keyboard and retiring. Rekenthaler combined curiosity, deep knowledge of the markets, and skepticism of conventional wisdom with the ability to take complicated subjects and make them easy to understand. All that and a great sense of humor are why I truly admire him, and he will be missed here at Morningstar. You can find his last column here. As always, it’s a great read.
Check out our Markets page for our latest coverage and live stock market updates, along with our weekly calendar of key upcoming data and events.
The author or authors do not own shares in any securities mentioned in this article. Find out about Morningstar’s editorial policies.
